The commercial property business will seek to build a 220-room hotel in KK, and another 300-room structure with 100 service apartments in KL
by BHUPINDER SINGH / pic credit: hsindustrialhub.com
HAP Seng Consolidated Bhd’s commercial property focus over the next two years will be on a development of two new hotels and the completion of its industrial hub in Shah Alam, Selangor.
The commercial property business, held under Hap Seng Land Sdn Bhd, will seek to build a 220-room hotel in Kota Kinabalu (KK), Sabah, and another 300room structure with 100 service apartments in Kuala Lumpur (KL), next to the Malaysia International Trade and Exhibition Centre.
“We will not be making quick and fast decisions. Our projects must create value to the group and community. The two hotels will be managed by the Hyatt group.
“The KK hotel will cost some RM300 million to build and is expected to be completed by the second quarter of 2022 (2Q22),” Hap Seng Land property management director Manfred Weber said in KL on Tuesday.
He said the KL hotel project is still in the design stage but expected to be completed by 2025.
The KK hotel will have the “Hyatt Centric” brand while the KL property will be a “Hyatt Regency” brand.
The commercial properties developed by the Hap Seng group are kept for recurring income while the residential development business is mainly for sale.
Revenue from the property business amounted to RM490.8 million for the 1Q ended March 31, 2020 or about a third of group revenue of RM1.48 billion.
It accounted for RM248.8 million in operating profit for the quarter when the group recorded an operating profit of RM291.8 million.
The Hap Seng Industrial Hub in Shah Alam is almost complete and has 1.38 million sq ft of built-up area with underground parking, Weber said.
Costing some RM500 million to be developed, the mix industrial/commercial development houses industrial, warehousing, showroom and commercial buildings and seeks to cater to logistics-centric businesses due to its prime location, according to Weber.
The crown jewel of the commercial property portfolio is its Plaza Hap Seng in the heart of KL City Centre. Consisting of three towers with some 885,900 sq ft of built-up area, the Menara Hap Seng 3 is the latest to be completed and launched by the group.
The new 26-storey tower has some 200,000 sq ft of office space and 43,000 sq ft of retail space. The office space has attracted Tokio Marine Insurans (M) Bhd as its anchor tenant and Weber is confident its prime location will see good interest from other prospects despite the negative impact of the Covid-19 pandemic on the economy and commercial property demand.